I read an interesting blog post by Justin Vincent recently titled How I converted from PayPal to Stripe in just two days. For start ups and small businesses it has always been a headache to set up on the web and securely accept credit cards in a PCI compliant manner – although I think it’s better than back in 2010 when Sachin wrote this now famous post. PayPal was arguably the first to solve the problem of having to get a separate internet merchant account and gateway by bundling it all into one. Alas, time and success seems to have resulted in mixed feelings around the PayPal API and/or customer support experience. There are a fair number of horror stories about how PayPal has negatively impacted a business in one way or another. Some criticism is probably unfair (fraud is a nightmare to manage) while some of it certainly seems legitimate. It also doesn’t help that in many instances your customer has to leave your site to go to an external PayPal page for transactions.

Braintree appears to be the first to seize upon discontent with what some people felt like were archaic API’s and/or poor service by existing gateways. From what I’ve read and heard they came at it with a Zappos approach. This is your billing, this is critically important, so why would you not want the best possible experience when interacting with your provider in this space? Having recenty raised $34 million it appears they understood the opportunity well. However, Braintree has a minimum monthly fee of $75 which is prohibitive to smaller business. Stripe steps in with no minimum, a great API and documentation and it’s off to the races! Here’s one example of the initial response to Stripe’s arrival

Stripe takes a higher % of your transaction though – perhaps to offset that lack of a monthly fee and the convenient service they provide. So discussions about Stripe tend to fall into one of two categories pretty quickly:

• This is a hobby/lifestyle business for me so I’m not really concerned about 0.5% to 1% difference in transaction fees
• A smarter API and documentation along with a single source (merchant account and gateway bundled together) is very nice but too expensive a luxury at those fees

Let’s put the hobbyists and lifestyle businesses to the side for one moment. If you have one of those (less than $3000 a month in sales?) the good news is you have more choices than ever to hit the ground running.

For the rest of you though, you’re faced with the following conundrum:

• Which API do I code against?
• Which gateway/merchant account do I select?
• Do I sign with one of the bigger ones and pay higher monthly fees to get access to a lower discount rate or do I go with a smaller gateway and pay higher fees for now and know I’ll have to change later when I grow?

Here’s how one industry veteran of online commerce put it to me. “Gateway/Merchant accounts are like a vacation. You can have a fantastic vacation when you’re 18, 38 and 58 – but it’s unlikely to be at the same location. Make sure you can change vacation locations to suit your ever changing needs”

That’s a big part of the value prop behind Spreedly Core. To keep with the analogy above: How do you avoid continually vacationing at Disneyland because you really enjoyed it when you were 12? There’s 3 or 4 reasons why that might happen:

• Outsourcing and storing your credit cards at your gateway to tackle PCI compliance made sense at the time. However, now they, not you, have all your credit card information.
• You coded directly against the gateway API. Perhaps even more problematically – you went further and utilized API’s for more advanced functionality like recurring billing
• You wanted to have more than one merchant account gateway for financial or strategic (failover recovery) reasons
• It never occurred to you that as you grew you would be eligible for a much better set of fees or a more comprehensive range of services

In terms of the first bullet point – it’s important to point out that newer offerings like Braintree and Stripe are willing to return your customer data. Other’s are arguably not so kind and either way it’s a pain to manage.

Going back to Justin’s article above in our example we’ve had customers move from PayPal to Stripe in an hour or two.

Today it costs 2 cents to store a card and 10 cents a transaction as we come out of beta. Yes, that’s on top of whatever fees you pay a gateway and merchant account. It should be noted that most gateways have some fees for storing cards on your behalf so you would not have to sign up for those. Authorize.net calls it a “CIM” and charges a flat $20 per month while Braintree is $20 per month for a “vault” + 1 cent per card.

Core requires you to bring your own front end – whether that’s a commerce cart, subscription page or the ability to do a unique invoice each time that you want billed (cloud utility or pay as you go type services where no two invoices are the same). We think of Core as a cloud based billing utility designed to scale both for your and our business.

We look forward to bringing Spreedly Core officially out of beta at the end of this month and merging it into our main site at spreedly.com. Let us know here, or directly via email, what you think. We are also really interested in the feedback from all quarters.

P.S: Given that Core came out of our Spreedly subscription offering the benefits listed above are also enjoyed by our subscription customers.

Spreedly Subscriptions went into emergency maintenance mode for about 50 minutes today. We apologize for the incident and any inconvenience that occurred. We are acutely aware that you depend on our availability and we take that responsibility seriously. Ironically, what triggered the incident was a small part of a much larger plan to move data centers with zero downtime. This is not how we wanted to break the news of our new facilities.

To make the move we needed to extend our MySQL replication chain to the new data center. In the process of doing so, a database dump was accidentally loaded onto the primary database at the production data center. The intended target was the primary database at the new data center. This caused tables to be dropped and reloaded all while the site was online. We can refer to this timeframe as the “disaster window.” The error was caught when we noticed our new database’s storage wasn’t filling. At that point, we went into emergency maintenance mode to begin recovering.

While in maintenance mode, we restored all data from the latest backup. This particular backup was originally made to seed the new sql nodes at the new data center, so it was less than an hour old. Once imported, we brought the site back online. Then we manually handled the tough work of restoring the data that came via API while the database was tearing itself apart. With this done we were fully recovered.

Again, our apologies for any issues this may have caused you and your business. In brighter news, the original task of enabling site-to-site database replication has been completed as well and puts us one step closer to a very big upgrade for Spreedly and its customers.

There’s an interesting blog post over at RoRe comparing Stripe vs ActiveMerchant Given this is an area of interest for many of our US customers (Stripe is currently only available in the US) I thought I’d highlight it here. As it relates to Spreedly Core customers who are using Stripe the situation is slightly different. That’s because Spreedly Core is handling the credit card storage and processing these types of requests . Here’s the documentation if you want to dig deeper. Feel free to ask any questions here or add to the discussion over at RoR.

Going forward, we are going to highlight Spreedly customers. We do that with two goals in mind. Firstly, many of our customers are in start up mode and we’re happy to help in any way we can with getting the word out. Secondly, it might help prospective customers as they research our space in general. So here we go with Realtyninja.com

Tell us a little about your offering. How did you come up with the idea? What need did you see that wasn’t being fulfilled as well as you’d like?

We had been building custom real estate websites for years and found that we were targeting the few people in the industry who could afford or really utilize a full blown custom site. Not only was this model not sustainable in the long run but we found that it was not fulfilling the needs of our market. There are numerous companies who provide real estate agents with websites, but we found they were all far to complex, were not visually appealing and were approaching it from the wrong direction. It is our belief that you should start by looking at the problems you are trying to solve and the desired outcomes of using a service like our own: saving time and generating leads. Again this comes back to the less is more approach, not simply throwing technology at the problem. In fact, the more our clients can essentially forget about the technology while still getting the results they desire, the better. To sound a tad cliche, we focus on the why not the what.

RealtyNinja makes creating and managing your real estate website a breeze. It allows you to focus on your core business and takes the stress out of maintaining your website. We have all the features in our sites needed to be a successful real estate agent and have paired them with beautiful designs and an incredibly simple management interface. We focus on fostering an awesome experience from start to finish. We do not strive to have the most advanced system with the longest list of features because that is going to be far too complex for the bulk of ones needs and will simply get in the way. Instead we focus on providing the simplest and most polished interface and follow the concept of the minimum effective dose. What is the least amount of time and effort you can spend as a user of our system to get the maximum output. People are far to busy doing their real job (selling real estate) to take advantage of or really care about a laundry list of features. We only build features that save an agent time or directly help generate more leads. If a feature does not do either or at least one, we simply forget about it.

Spreedly has a lot of developers as customers. If applicable, tell us a little about the technology decisions you’ve made up to this point to drive your business. Do you think technology will be a key differentiator in your success and if yes how so?

Technology is definitely a key differentiator in our product and in our business as a whole. I see it as one of our main strengths and part of the reason we are all so inspired to come to work and give it our all every morning. At the core we are a group of geeks who are inspired by the potential of technology, design and the internet. We channel this energy and enthusiasm into our medium which happens to be a real estate website SaaS app at this point in time.

The technology we use allows us to be incredibly agile, react quickly and stay ahead of some of our much larger and heavier competition. Not to mention satiate our need to flirt with the bleeding edge and hone our ninja skills. We are big proponents of standing on the shoulders of giants and not reinventing the wheel when it doesn’t have to be. We want to use tools and technologies created by people who are the best at what they do as we can’t simply be the best at everything on our own.

A prime example of this would be our decision to use Spreedly to handle our billing system. At first we were going to roll our own and even started blocking out the code but quickly realized that we were entering the realm of a completely different skill set and business. PCI compliance, fraud protection, real time API’s with very sensitive data, dealing with real people’s real money… it was starting to freak us out and was turning into a major stressor. Not only was Spreedly incredibly easy to implement (!!) but the marginal costs have been more than worth the freedom of mind and worry free sleeps =)

Here is a short list of the tools we use on a daily basis:

• SPREEDLY!!!
• Linux
• nginx (so fast like ninja!)
• Perl the amazing Catalyst web framework
• template::toolkit, DBIx::Class and so many more modules on CPAN
• Javascript and Jquery
• Fancybox
• basecamp, campfire, highrise
• beanstalkapp
• TheSchwartz queueing system
• rangy So many more!

What are the two or three things that are your top priority right now for where you are as a business? Why are they important?

1. Scaling our awesome customer support and experience because this cannot be automated (to a point). This is one of our main differentiating factors and is in our mind the key to our success in the long run.
2. Systemizing our internal processes so we can focus on what is important: our clients and our application. We are the definition of bootstrapping and thus a lot of our internal systems and procedures are handled manually or have a lot of room for improvement.
3. Getting to the point with RealtyNinja where we do not have to run our consulting business on the side to pick up the slack. We want to focus on RealtyNinja 100% and it is very difficult and stressful to run 2 business that both demand 110% of your attention

Why did you choose Spreedly over other options? Do you have any comments or advice for current or potentially future Spreedly customers based on your experiences?

We chose Spreedly for the simple reason that they were the best option on the table. We have stuck with spreedly and plan to do so in the long term because for what we need, they are still the best option. Not to mention the customer support is amazing and we feel like we share a bond in the start-up world. We are walking the same path, facing the same challenges and feel that a bond such as this cannot be replaced with an extra feature here or there or different pricing structure. Just as we are dedicated to making the best real estate website SaaS application, we know and rest assured that spreedly is dedicated to being the best at what they do and what we need.

I’m writing this based on the fiasco this week around PayPal and Regretsy It’s a reminder of the sort of power that your gateway and merchant account can have – and why having the ability to change quickly might be a good idea.

Getting a gateway and a merchant account can feel like an impediment when thinking about commerce online – especially for a start up. We understand that. Therefore many people do a quick price comparison, scour the web for good or bad comments, and jump in. At Spreedly we believe to write to just one gateway is a risky proposition. Therefore, a guiding principle here is to create gateway independence. We’ve connected to 25+ gateways Now, you still have to pick an initial gateway and merchant account. We focus on making sure we support your choice.

Why is it risky? Let’s say you decide you want to change your gateway. It might be that you’re unhappy with your current choice. Support might not be what you were hoping for or, as you grow, you realize that a few basis points difference is really starting to add up. Or it might be that you’re happy with your current offering but a new gateway comes along that you find very compelling and desire to switch.

If you had written to the Spreedly API – and we support your new gateway – switching is simple. If you have written directly to the gateway you have to now write to a new gateway API. Doable, but a real dampener on change. Secondly, if you’ve written to Spreedly we have retained your customer credit card information. No asking politely and hoping that your gateway will return it to you. Some make it very difficult (impossible?) while others make it easier. Either way it’s their least favorite type of support request and in all fairness, given PCI requirements, is not as straight forward as attaching a spreadsheet on an email. However, you really have no choice but to grit it out and get your customer data back. Otherwise you’re looking at significant churn when, after changing gateways, you require your customers to re-enter their credit card information because you couldn’t bring it over. I’ve heard anecdotal stories of people who went down that route rather than continue to wait for their old gateway to come good.

That’s why we see two types of customers. Those that are new to launching their service and shop gateway’s based on price and word of mouth. Then there is the second group – “not my first time at the rodeo” type . Their eyes light up when they realize they can have their favorite gateway and gateway independence too.

Hi There,

I wanted to introduce myself to everyone and talk a little about Spreedly and why I joined the team. Commerce, in many ways more than a decade old on the web, is undergoing real change. Remember when everyone sort of gave up on it in the mid 2000’s? Amazon and eBay had it all sewn up was the general conclusion. Now, mobile is helping drive ease of access. Social Networks drive down customer acquisition costs making richer niche sites possible. Technology “on demand” creates new consumption models. Collaborative commerce can turn any one of us into a “producer” or “consumer” at any moment in time. Flash sales sure haven’t hurt either.

Spreedly appealed to me for 3 major reasons. One, I love start ups and had gotten away from this world. Two, the space is undergoing significant change and growth. Probably most importantly though was that the team here had built a real, tangible service – including passionate and vocal customers!

I have a 15 year background in sales, marketing and business development in enterprise SaaS world. At the risk of dating myself, I was selling “Cloud” based services in a time when people said “Oh, you’re an ASP!” If you’re really interested in learning more about me you can find out more here.

When it comes to subscriptions and e-commmerce, billing and invoicing is the glue that helps makes all this work. As you all know it’s complete with old world, highly regulated, antiquated services bumping head on into modern consumption and pricing models. Our smartest customers push us to get that friction point to zero. We may never actually get there, partly because you keep moving the goal posts, but that’s our mission.

Needless to say we have big plans focused on growth and expanding our services to better serve everyone. Feel free to email me if you want to connect. Thank you to those of you who have supported Spreedly up till now. Stay tuned over the coming weeks and months.

Regards,

Justin

Spreedly’s initial product focus was on recurring billing – that’s how our customers know us and use us right now. Today we are announcing that on Nov. 15th our existing customers will also be getting access to Spreedly Core – all as part of their current monthly fee with Spreedly.

So what is Spreedly Core? Core was driven by 3 major needs. First, our customers asked us to do any kind of transaction, not just recurring or subscription transactions. Core handles that. Second, Core provides gateway independence, allowing you to use one or many, and switch between them whenever you’d like. Finally, with Core you get total UI/UX control. Your customer stays on your site, and Core takes care of the hard stuff behind the scenes. Therefore, you have end to end control of the user experience.

Core’s been in beta up till now (and will technically remain so through the end of this year). We gathered some feedback from our beta users. First up, Tim Ridgely at OpenDining.net:

“We’d spent months setting up a PCI compliant infrastructure and when I found out about Core, we just ditched the whole thing. Even though it was done and ready to roll (PCI SAQ complete, over 120,000 daily log events managed within Splunk, etc.).

“For us, it’s very simple: our core competency absolutely does not revolve around securely managing card data. Core lets us offload that, while fitting seamlessly into our business process and technical infrastructure.”

Nik Bauman from tonx.org – “We source, we roast, we ship, you brew” coffee – had similar sentiments:

“SpreedlyCore instantly appealed to me because it took risk from my business. It makes my business stronger by preventing lock-in and letting me command better prices from payment processors. If you are running a business storing credit cards using Spreedly Core is the smart way to do it.”

Ready to start looking at Core? Until November 15th, just head over to www.spreedlycore.com and ask us for an invite – we’ll get you one. After November 15th, you’ll be able to create a Core environment right from within your Spreedly account, so it’ll be even easier.

Through the end of the year, Core will remain a beta product. We’re continuing to improve the docs, helper libraries, and tightly integrate it with our subscriptions product (for those who want that). You’ll definitely want to be a confident developer to tackle Core and be ready to bug us when you can’t figure something out.

That’s it for now! Send us feedback anytime on what you think of Core – it’s always appreciated.

Nearly four years ago I and 3 cofounders created Spreedly. I was working on a consulting project where the billing component was an “after thought”. When that after thought became larger than the actual project I figured there might be a business opportunity somewhere in all that development, and so the Spreedly adventure began.

Fast forward three years and Spreedly has reached some pretty significant milestones. We support nearly 300 customers, process 20,000+ transactions every month and reach over 100,000 end users. In every measurable way we’re growing.

With growth comes change. An ever-growing customer base and market presents opportunities and challenges. We need greater resources to ensure that we continue to service our customers and execute on our roadmap and vision. As part of this process we engaged outside help and took a long hard look at our pricing, customers requirements, goals and the marketplace. Together, we realized that our pricing was unsustainable. Simply put, our pricing didn’t reflect the true costs of building, enhancing and maintaining a world-class payment platform for our customers. We have therefore adjusted our pricing – we’ve raised it across the board. To learn more visit our updated pricing page on spreedly.com. Our new prices will come into effect on your next renewal on or after November 15th.

We understand that nobody likes to see a pricing increase. That said, we hope you can understand the trade off – you want a financially secure, well-resourced provider that’s adding new features on a regular basis. We are keenly aware that we’re a critical part of your revenue stream so you need us to do well and stay competitive. However, if for any reason you are unhappy about the change we understand that too. We want happy customers not hostages! Email us at sales@spreedly.com and we’ll grandfather you at the current pricing for up to 90 days so you have time to change to a new provider.

That’s it for now. Keep an eye out on our blog and twitter as we continue to update you on our progress.

Regards, Nathaniel Talbott Writing for the whole Spreedly Team

One of the nice things about being at Spreedly is we have a lot in common with our customers. We’re always working on ways to optimize the subscription business. One hot topic out there is the idea of Freemium. One great article out there is a blog post by Mail Chimp Many of you have probably already seen this post – it’s a well known entry on the topic. If you haven’t though, check out Mail Chimp’s blog

Discuss the surge of interest in the subscription and recurring payments space and most people assume it is driven by the dramatic growth in digital goods. Music, software, digital books and movies (Netflix anyone?) are just some examples. While that’s definitely a big part of what’s going on what is often overlooked is the growth of subscription services around physical goods. This article is a good example of growing subscription business built on durable consumer goods. On the Spreedly side, two of our own customers include Rose Park Roasters and Rumpus.

Enjoy the article.

http://tnw.co/roysCx

Hello from the Spreedly team! As many of you know, it’s an exciting time in the subscription and recurring billing space. There’s a tremendous amount of innovation going on between us, our competitors and our customers. Subscriptions are changing the way people purchase and consume products and services and we’re going to continue to be right in the thick of the action.

In fact, in just the last 45 days, our customers have driven more than $1 million in revenue through our service. We thought that was pretty cool. So thank you. We’ve come a long way from our first month yet in many ways feel like this is the tip of the iceberg.

The Spreedly Team

Both of Spreedly’s products, Subscriptions and Core, were down for a little over four hours yesterday (5/18). We know this had a significant impact on our customers businesses, and we want to give you a rundown of what happened, what we learned, and what our plans are going forward to keep this from ever happening again.

Read the rest of this entry

Great article from the Quplo team about their challenges with getting set up to take payments in the Netherlands; outside of the United Kingdom it seems like this is a challenge for a lot of European businesses, so it’s well worth a read. Our favorite quote:

“Why were things so tough? Because we found Spreedly early on, and fell in love. Spreedly kicks ass. It’s a clean little service with great UI design, a really simple API and it just felt right. It wasn’t enterprisey – I could talk to the lead developer directly, with fast email replies. That’s what we needed.”—Looking back on the quest for payments on the Quplo Blog

It goes on from there to explain why using Spreedly complicated things, why it was worth the complication, and how they were finally able to find a solution. Welcome onboard Quplo, and thanks for writing about your journey!

In the wee hours of the morning (EST) the part of our infrastructure that handles SSL failed. While definitely a problem, this should have been a half hour of downtime max. Where we really messed up was in having our external notification service checking the service only via HTTP and not HTTPS, meaning we didn’t receive any pages or other direct notifications as to the problem. This turned what would’ve been minimal downtime into a few hours of downtime, basically until a member of the team got up and saw all of the tweets and emails from affected customers.

The worst possible scenario for an outage is to first learn about it from your customers, and that’s further compounded by learning about it hours later. The whole team here at Spreedly feels really bad about the downtime, and our top priority right now is to fix the monitoring issue and track down the root cause of the SSL failure to ensure it doesn’t happen again.

Some specifics on what we’re doing: we immediately switched our external monitoring service to check https instead of http (everything important on Spreedly runs over https), and are now furiously running stress tests to try to reproduce the problem that took us down. So far it appears to be an issue with a recent kernel upgrade, and we’re working to reproduce it in isolation so that we can be sure that our fix actually fixes things.

Once we catch our breath, we’ll be going beyond today’s triage: first, while we have internal monitoring already in place, the checks there also need to be beefed up. Second, we’ll be implementing a second line of external monitoring as a failsafe. Third, while the goal is to never have it go down, we’re going to increase redundancy around the SSL component so that even if it were to go down again, we’ll be back up and running in five minutes or less – thirty minutes is still way too long.

We know that you entrust your businesses to us, and we take that trust seriously. Our hope is that we haven’t put too big a ding in it, and that over the coming months we can rebuild any trust that was lost. Since I know a lot of our customers are in the business of providing services themselves, I’ll just close with a little PSA:

If you’re not 100% sure you’ll be notified in the event any important part of your service is down, go right now and double-check. It takes just a few minutes and is totally worth it.

And as always, if you have any concerns, questions, etc., just drop us a line at support@spreedly.com – we’re open to any feedback you have.

This is a busy travel week for us here at Spreedly, with two of us at conferences on two different ends of the country.

John Carlin, @thejohnny on Twitter, is in San Francisco, CA for Apple’s WWDC. Look him up to chat about the optimized mobile payments interface we recently rolled out, and how you can integrate Spreedly with your native iOS apps.

Nathaniel Talbott, @ntalbott on Twitter, is in Baltimore, MD for RailsConf. You can see him on the e-commerce panel after lunch today (Tuesday), and look him up anytime to chat about using Spreedly in your web applications.

We’d love to meet you, so don’t be shy!